INDIANAPOLIS -
Adam McPherson notices that pump price has been going up. "Everyday, it seems like," he said.
Adam McPherson just has to eat it, thanks partly to the drought eating the corn crop.
On the Lee Farm in Boone County and around the Midwest, farmers may lose 15 percent of their corn crop or more.
"And then ethanol is consuming half of that," says Dr. Matt Will, a University of Indianapolis professor. "There's very little left for food consumption and the rest of course is higher prices at the grocery store and higher prices at the pump."
Higher prices at the pump because gasoline is required to be 10 percent ethanol.
Under federal law, up to 40 percent of the corn crop is supposed to go into bio fuels. But critics say while that saves on fossil fuels, it costs us somewhere else.
"It's hard to tell how much of the gas price you see now is related to this," says Will. But experts say with corn futures up 60 percent since June, it's having a pump price impact. Some estimate a nickel extra a gallon. And it goes beyond gas.
"The heat got in the corn, it really hurt it," says Bret Lee, a Boone County farmer.
Lee was loading last year's corn into a truck from storage. "It's probably headed down south, probably to feed chicken and hogs in Carolina," he said.
Feeding pigs and chicken that could now cost more at the grocery because their grain costs more.
"Last five or six years the ethanol plants got going, it's helped the grain industry tremendously," Lee said. But there are efforts now to get government to cut the amount of ethanol set aside for gasoline.
The ethanol industry says the product is actually cutting pump prices by replacing costly foreign oil. They see no big drought impact on pump prices because there's a surplus of ethanol.
"I really don't have an opinion honestly," says Adam McPherson. "I just want it to be lower than it is."
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